In October 2016, Ethical Consumer viewed an article by Reuters dated 28 August 2015, titled, "Pentagon teams up with Apple, Boeing to develop wearable tech". The article stated, "U.S. Defense Secretary Ash Carter awarded $75 million on Friday to help a consortium of high-tech firms and researchers develop electronic systems packed with sensors flexible enough to be worn by soldiers or molded onto the skin of a plane." "The technology also could ultimately be used to integrate sensors directly onto the surfaces of ships or warplanes, allowing real-time monitoring of their structural integrity."
As such Apple lost a whole mark under Arms and Military Supply.

Reference:

Pentagon teams up with Apple (28 August 2015)

In August 2018 Ethical Consumer sent Apple a questionnaire requesting details of its supply chain management. No response was received and the company's website was searched. Documents were found including the 2018 Supplier Responsibility Report, on the basis of which the company was rated as follows:

Supply chain policy (reasonable)
The company's Supplier Code of Conduct was dated 1 January 2018. The Code stated that it applied to "Apple suppliers and their subsidiaries, afliates, and subcontractors (each a “Supplier”) providing goods or services to Apple, or for use in or with Apple products."

It included adequate clauses on child labour, working hours, forced labour, freedom of association, and discrimination. It did not guarantee payment of a living wage. Apple was considered to have reasonable supply chain policy.

Stakeholder engagement (rudimentary)
Apple's Progress Report 2018 was viewed, which stated that the company was working with a multi-stakeholder initiative to improve its tin supply chain, however it did not appear that it was working with organisations on labour standards in its manufacturing. Apple mentionned anonymous complaint systems that encourage workers to report workplace violations and retaliations . Overall Apple received a rudimentary rating for stakeholder engagement.

Auditing and reporting (poor)
Apple stated that "in 2017, we conducted 756 assessments in 30 countries, covering 95 percent of our total spend". However, there was no disclosure of audit results at factory or supplier level - although there was discussion about overall audit findings. There was no clear schedule of audits, nor a statement it would audit its whole supply chain, nor mention of the costs of audits. The remediation strategy included a Corrective Action Plan. Because of the lack of detail given, Apple was considered to have a poor approach to auditing and reporting.

Difficult issues (reasonable)
A difficult issue within the electronics industry is child labour. Apple detailed how it required suppliers - if they were found to be using child labour - to commit to a remediation strategy of returning the child back to their home and supporting them. Only two cases were found in 2017.
Another difficult issue it was addressing was the use of third-party recruiters to secure contract workers. Apple required suppliers to reimburse fees back to the workers.
Apple was considered to be addressing some of the difficult issues within its supply chain therefore it was considered to have a reasonable approach to difficult issues.

Given that Apple was rated poor for auditing and reporting, rudimentary for stakeholder engagement and reasonable for supply chain policy and difficult issues, it received a middle rating for Supply Chain Management.

Reference:

Supplier responsibility 2018 report (14 August 2018)

An article published on the Guardian website on 27 July 2015 raised concerns about the marketing tactics of childrens' games manufacturers.

It mentioned a case in 2014 when Apple announced it would refund $32.5m to parents who’d been billed for unauthorised in-app purchases made by their children in order to settle a dispute with the Federal Trade Commission (FTC).

The article stated that in 2013 aggressive monetisation techniques such as requiring a real-life purchase during a game to continue play had caught the attention of the UK’s Office of Fair Trading (which had since become the Competition and Markets Authority). The CMA had launched an investigation into the way in-app purchases were marketed to children. It expressed concerns that some companies were attempting to exploit “children’s inexperience, vulnerability and credulity, including by aggressive commercial practices” such as “direct exhortations to children to buy advertised products” or persuading their parents to do so for them. It subsequently published a set of principles designed to remind developers of their responsibilities under consumer protection law.
The Children’s Rights and Business Principles, developed by UNICEF, the UN Global Compact and Save the Children, were also applicable to video games. Principle Five, for example, required companies to ensure that their “products and services are safe, and seek to support children’s rights through them”. Additionally, Principle Six called for marketing and advertising that respected and supported children’s rights.

The article noted that the fact that the CMA recently referred three online children’s games to the Advertising Standards Authority due to concerns that they may be pressuring children into buying extra features suggested that some developers of children’s apps were unaware of the principles and guidelines that applied to their products - or were choosing to ignore them.

Even when developers did follow available guidance, the default settings on mobile devices could still catch people out, it said. Parents and children weren’t always aware that every app or in-app purchase opens a 15 minute window when further purchases can be made, as with the case of Apple above.

As such Apple lost half a mark under Irresponsible Marketing

Marked as info only because Apple said it would refund.

Reference:

Responsiblities of the gaming industry in protecting children's rights (27 July 2015)

In August 2018, Ethical Consumer viewed the family tree for Apple Inc, on the corporate website www.hoovers.com, which stated that the company had subsidiaries in the following countries: India, China and Thailand. These countries were considered by Ethical Consumer to be oppressive regimes at the time of writing.
As such Apple lost half a mark under Human Rights.

Reference:

Generic Hoovers ref 2018 (2018)

In August 2018 Ethical Consumer viewed Apple Inc's 2017 SEC Filing SD form which dealt with the issue of conflict minerals. Conflict minerals are minerals mined in conditions of armed conflict and human rights abuses, notably in the eastern provinces of the Democratic Republic of Congo (DRC). The minerals in question are Tantalum, Tin, Tungsten and Gold (3TG for short) and are key components of electronic devices, from mobile phones to televisions.

Ethical Consumer expected any company manufacturing electronics to have a policy on the sourcing of conflict minerals.

Apple stated: "Apple will continue to responsibly source conflict minerals throughout its supply chain and press for continuous improvements in industry-wide due diligence approaches and human rights–focused practices to make a positive impact on the lives of people living in the DRC and adjoining countries." Ethical Consumer took this to be a statement of intent to stay sourcing from the DRC.

The company was a member of several initiatives such as Conflict Free Sourcing Initiative. Apple supported the efforts of other Third Party Audit programs, such as those carried out by the London Bullion Market Association (the “LBMA”), the Responsible Jewellery Council and ITRI through its Tin Supply Chain Initiative (“iTSCi”), to be better aligned with the Organisation for Economic Co-operation and Development Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas (“OECD Guidance”)."

Apple's suppliers were required to to adopt a robust conflict minerals policy as stapilated in Apple's Supplier Code of Conduct. The company used OECD Guidance as a way to track, assess and respond to risks within its supply chain and required suppliers to source minerals from smelters which had been verified as compliant.
Apple's SD form had a full list of smelters and refiners (SORs). It had also achieved 100% of its smelters in its supply chain as being verified compliant.

Overall Apple received Ethical Consumer's best rating for its conflict minerals report.

Reference:

SEC filing form SD 2017 (14 August 2018)

In October 2016 Amnesty International released the report “For your eyes only? Ranking 11 technology companies on encryption and human rights”, which ranked companies on whether they were meeting their human rights responsibilities by using encryption to protect users’ right to privacy online. It focused specifically on companies that provided instant messaging (IM) services.

Apple was one of three companies placed highest in the ranking, scoring 67 points out of 100 which meant they were “applying end to end encryption as default to all their instant messaging services.”

Amnesty contacted Apple to request information and the company answered Amnesty International's request for information on behalf of both Facebook and WhatsApp.

Apple was said to recognise online threats to freedom of expression and right to privacy as risks to its users through its policies and procedures but had no policy commitment to freedom of expression. The company deployed end to end encryption as default, used an inadequate notification to users within the apps about risks and encryption. It disclosed government request for using data and notified the affected user unless legally prohibited. The company had taken public stance against encryption backdoors. Apple shared some specification of encryption, but its protocol was not open source.

The report concluded that all 11 companies in the report had room for improvement. Therefore Apple lost a half mark under the Human Rights category.

Reference:

FOR YOUR EYES ONLY? RANKING 11 TECHNOLOGY COMPANIES ON ENCRYPTION AND HUMAN RIGHTS (21 October 2016)

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In October 2015 an investigation by China Labour watch revealed that despiet promises to address issues at the Shanghai-based Pegatron Technology factory conditions there for workers remained poor.

The report entitled “Something’s Not Right Here” calls on Apple CEO Tim Cook to acknowledge the problems and work harder to put them right.

The report outlines how workers at Pegatron, which produces Apple’s iconic iPhone:
often work 12-hour shifts,
often work six days a week,
are forced to do overtime work and unpaid labor,
have short breaks for meals,
facing hiring fees and unreasonable fines, and
receiving inadequate training in safety and prevention measures

This researchers say is all covered up by Pegatron management through fraudulent documentation. They add that "Pegatron also contravenes Chinese law in its excessive use of precarious temp labor and its refusal to pay legally mandated benefits to its workers."

Problems that they say are all exacerbated by the lack of any labour union.

CLW say that this "grim reality" stands in contrast to Apple’s ethical commitments (the company receives an Ethical Consumer middle rating for its supply chain management).

CLW compared findings from its new investigation with those of a 2013 investigation of Pegatron. Among 21 categories of legal and ethical violations that were identified they found that, 11 went unchanged, five problems deteriorated further, and four showed partial but incomplete improvement.

One category of violation, hiring discrimination, appeared to have improved. But this may have been influenced by the fact that CLW’s investigator was hired directly by the company rather than as a temp worker, where more discriminatory hiring practices are common.

Reference:

Chinese Factory Producing Apple’s iPhone 6s Exposed Again for Ongoing Labor Abuses (30 October 2015)

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